With a variety of difficulties plaguing the casual dining industry, operators must do all they can to appeal to every age group. John Trueman explains
The difficulties being faced by the hospitality industry have been a favourite topic of doomsayers for quite some time. From Jamie’s Italian to ASK and Patisserie Valerie, restaurants and chains have been hitting the rocks with alarming frequency. The casual dining crunch, the prevalence of large chains and the hottest topic of all, Brexit, have all been blamed for the restaurant industry’s struggles. Now, ‘the takeaway generation’ is in the firing line.
A recent survey claimed that 20% of millennials use home-delivery services rather than dining out, compared to 9% of Generation Xers. Time-poor and convenience-led, this group are now being blamed for the restaurant industry’s struggles – but is that really fair?
No-shows are a major issue for restaurants: on Valentine’s Day this year, several high-profile restaurants claimed to have lost thousands of pounds on a single night, due to people not showing up for their bookings. The rise of services like Deliveroo and Just Eat are undoubtedly putting restaurants, especially those who do not offer deliveries, under more strain – but millennials only make up a quarter of no-shows and a fifth of Deliveroo customers, so it is downright unrealistic to lay the blame at their door.
Millennials enjoy dining out – taking pictures of their meals for Instagram, using payment apps and logging reviews have all become part of a wider social experience – so rather than blame them, restaurants need to adapt to this new market segment and think about how best to meet its needs. Gluten-free menus, mobile phone charging points, vegan options and technology-led reward schemes directly appeal to this group: it’s obvious that those outlets who recognise this and adapt accordingly are the most likely to capitalise.
Technologically-savvy millennials make up 30% of diners, and they love a good app. The right app-based loyalty scheme provides restaurants with the opportunity to build a community of loyal diners, grow revenue streams, and protect themselves from no-shows. As well as rewarding customer loyalty and building brand familiarity, such schemes allow customers to view their bookings and, crucially, cancel them – allowing restaurants to rebook empty tables and reduce the number of no-shows.
Hospitality has been notoriously slow in its uptake of technology – comparing unfavourably with retail. Conversely, Deliveroo has capitalised on technology: its ease of use and swift service appealing to millennials in particular. Further, services like Deliveroo and Just Eat take full payment at the point of booking, so no-shows are not a consideration. Restaurants can and should go further to safeguard their revenue, and to do so they must embrace evolutions in the industry, not bemoan them.
All industries meet challenges and are forced to evolve, and it is unhelpful for any business to dig its heels in and lament the loss of the ‘good old days’. Millennials are our new customers, so let’s work out what they want, and for god’s sake, give it to them.
John Trueman is chief executive of Quadranet Systems